VTI (total stock market; better diversified) or VOO (s&p 500; higher volatility, likely better 15-20 year returns). Don't set any limits or monkey with it. Just buy the funds and let them ride. You are statistically unlikely to get a better return than index funds. If you do want to play with a little bit of it, take a small amount (10%?) and use that to experiment, then put the rest in the aforementioned index funds. I have a small amount of money that I do the same with. This is assuming that you have no other short term needs for the money. Do you also max out your Roth IRA as well as your 401k? Since it's going into a taxable brokerage account, it should be no problem to access that money in a week as long as he's not experimenting with options or something.
I am well covered elsewhere, and my biggest financial need is tax shelters. This stuff going into investments is because my 401ks etc are all maxed out. I did a Fidelity Go for a while and it just had no returns compared to the rest of my portfolio. So I figured I'd buy a sizable chunk of stocks and let them simmer.
MPLX has been my go to for shifting extra money into. It has a nice, stable dividend yield and at a time when other companies suspended and/or cut their dividends, they kept increasing it. My aim is to grow it so I can get a nice $15-20k revenue stream in retirement which I can just use as a travel fund. Stick a sizeable chunk into that and reinvest the dividends every quarter and you could have a pretty sizeable revenue stream in retirement.
Note that dividend stocks are not generally any better than non-dividend stocks. There's nothing particularly wrong with dividend stocks. Just important to know that, in almost all cases, there's no real benefit to getting paid a dividend vs. selling stock when you need money. Stock values are decreased by their dividend amount, so dividends are essentially just small forced stock sales at unchangeable intervals. If you like that steady stream without having to actually sell off anything, that's cool - go nuts. And you don't get to choose if a company pays a dividend or not, so if you like the company or the index and it happens to be dividend-paying, there's no reason to avoid it. But dividend stocks are somewhat tax-inefficient in taxable brokerage accounts and chasing dividends specifically is usually not a useful pursuit. If your employer offers a high deductible health plan with an HSA, that's about the best tax shelter around. If you're already maxing out your 401k, then basically the only thing left is a Roth IRA. You can contribute to 529 plans if you might have qualified educational expenses but the tax efficiency of those varies by state, and of course it requires you spend it on education.
@downndirty One other thing - you could check to see if your 401k supports a "mega backdoor Roth" - that is, if they support after-tax contributions (not Roth contributions; they must say "after tax") along with either in-service conversions, or in-service withdrawals. If your plan supports this, you can contribute after-tax dollars to your 401k, then immediately convert them to Roth dollars. Fidelity (and some others) have in-service conversions that are automated and will basically just scrape your after-tax dollars into your Roth 401k. Mine doesn't offer that, but I can use in-service withdrawals to have them send me a check a few times a year and I can deposit that into my Roth IRA.
Don't forget contribution allowances diminish if you make over $146k, and you can't contribute to a Roth IRA if you make over $161k. I'd check to make sure that as far as the Roth is concerned, the inheritance isn't considered income that pushes you over the limits.
Good point. If you have $0 in Traditional IRA accounts, you can do a backdoor Roth (note: unrelated to the "mega backdoor Roth" described above) at any income level, which is extremely simple. If you have >$0 in Traditional IRA accounts, it's less simple (but there are options).
This one bit me in the ass. My wife and I make more than the joint income threshold and I was paying a 6% penalty without realizing it for a few years.
So....all of the index funds are at or near 52-week highs. I'm sitting on this cash, in part because I think buying at or near the all-time high runs against most investment advice (something something buy low, sell high?). I'd like to park this $ on something in the short-term, but I'm very VERY leery of buying now, and having a modest market correction keep me in the red for months/years. So....safest place to park some of this so I'm at least getting a few $ each month? Or a stock/ETF/index fund that isn't at or near an all-time high?
If it's only short term, and you're prioritizing low risk, then you could drop it in Fidelity's money market fund (SPRXX), which is currently giving about ~5.2% return.
This isn't really correct. The best financial advice for money you don't need immediately is to buy and hold - time in the market beats timing the market. Read about Bob, the world's worst market timer. The stock market goes up over the long term, so it's constantly at all time highs. If you find an ETF that isn't close to an all time high right now, you are likely finding an ETF with a poor selection of stocks - the market is doing well right now. If you had invested on 02/16 when the market was at an ATH, you would still be up today. If you need this money in <5 years, @Aetius has good advice, or you could look at some treasury bonds.
Random credit card question for you guys. I've been looking at upgrading my travel cc (Chase Sapphire Preferred) for one of the more upscale cards. I've been tinkering with upgrading for the last few years, but I always fall down an information rabbit hole (usually on Reddit forums), get analysis paralysis and then give up. The three I am looking at are: Chase Sapphire Reserve: Given my CSP usage, this is definitely one that I've had my eye on. However, the CSP's bonus categories always seem to expand while this one stays the same or seems to diminish. Everyone I've talked to that has one seems to enjoy it pretty well though. Amex Platinum: This one seems really flashy, but I doubt it will be the one I wind up with. Of the list of credits/benefits I think we would only use the streaming credit, *maybe* Hilton Gold status and one or two others. It seems more like a vip pass with some travel benefits attached. Capital One Venture X: This is the other one (aside from the CSR) I've been inclining towards. Annual fee vs benefits/annual credits seems to offer the biggest bang for the buck. And I am a C1 user (had a regular card with them for about 20 years and upgraded to the Quicksilver maybe 6 or 7 years ago) and really enjoy their service. Looking at their lounge access they have a lounge out of O'Hare, which is where I usually flight out of and have lounges in most of the domestic airports I would fly into which is a nice plus. My wife and I will travel internationally about twice a year with maybe a handful (4 of 5 at least) domestic flights each year. Annual fee charge isn't really a huge concern. I would say I'm looking more for something that offers good lounge access that generates a solid amount of points each year. So would it even be worth upgrading to one of these? What experience, if any, do people have with any of them? Are there any other less talked about benefits (Rental car status, travel insurance, etc) benefits that make one stand out more than the other? Part of me is thinking of trying each one out for a year to at least churn out the intro bonus and see how I feel afterwards. Much appreciated!
I've had the Reserve card since it came out. It's a decent card with good points earnings, but nowhere near what it was. When it came out you got 100K points for spending $4K in 3 months. It's now 60K and the redemption value seems to get degraded year-after-year. That being said, it's still good enough to not trade-up. Plus it also gets you into the Chase Sapphire Lounges, which are probably the last decent lounges aside from the top tier lounges that aren't advertised. The customer service is also very good. I've had random issues while traveling and Reserve support (not sure if it's same as Preferred) has been excellent with no bullshit every time I've need them. If you go with it, you should downgrade your Preferred to regular Chase Sapphire so you don't pay the annual fee. I'm not sure what the Reserve's competitors are at this point aside from Amex Platinum, so it might be worth a comparison on NerdWallet or something. I also have the Amex AA Executive card which is also a $500/year one, but only because I have to book work trips with American Airlines and I rack up points very quickly doing that.
For CC's that have an annual fee, check to see if they'll waive it. I'm always surprised at how often I can get fees reduced or waived when I remember to ask. It does help to build a little rapport with whoever you're talking to. Front desk clerks and customer service reps have a lot more financial power than most realize. Amex will waive it for active duty members and I know they will waive it for a few other reasons as well. It doesn hurt to see if you meet any of the other reasons.
IIRC this is basically a glitch in the UI and I thought I remembered someone killed himself over that UI problem. The guy has a bunch of options and a bunch of stock to cover the options. His options went into the shitter and he's being told he owes the full value of all the exercised options - but he has stock to cover (a major portion of) those options. He might still be down (or maybe not) but the +/- is probably on the order of tens of thousands, not hundreds of thousands. Honestly, it's a horrendous user interface issue and I can't believe it still exists. Someone misunderstanding what is happening here might (and did) destroy their lives over the contents of that email.
You mean this? The dude who killed himself four years ago and they promised to resolve the issue, four years ago? What's especially insane, is that the day after he died, RH sent an automated message basically saying congratulations, everything worked out and you no longer owe any money.
Oh man, that looks it. Can't believe it was that long ago and people are still getting messages like this. I get that you're supposed to know what you're doing when you trade options, but at the end of the day it's a fucking checkbox that says, "sure, I know what I'm doing." That doesn't absolve them of the obligation to ensure they don't send people into an absolute tailspin panic over wildly inflated debt numbers.